Ram is a stockholder in Endrun Investments,which is organized as a corporation.Endrun recently lost a major court decision and will probably be forced into bankruptcy.In fact,the damages awarded are so great that,even if all of its assets are sold and the proceeds are used to pay its debts,Endrun is likely to still owe money to its creditors.If Endrun does go bankrupt,Ram and the other stockholders will:

Question

Quizplus · Accepted Answer

As a stockholder in a corporation, Ram's liability is limited to the amount he has invested in the company. In the case of bankruptcy, the corporation's assets will be used to pay off debts to creditors, and any remaining amount will be distributed among stockholders. However, if the corporation's debts exceed its assets, the stockholders are unlikely to receive any distribution and will lose their investment in the company. They will not be personally responsible for any remaining debts, but their liability is limited to their investment.

Ram Is a Stockholder in Endrun Investments,which Is Organized as a Corporation.Endrun